(Written by Merry Riana and Noriel Malacaman)

Philippines is considered as having one of the lowest savings rate in the world. More than 90% of Filipinos have too little or no savings at all and this number includes people who have the capacity to save. The poor savings habit and ethics can be attributed partly if not generally to the Filipino culture.

The problem is also evident even with our migrants and their families. One of the main reasons of why Filipinos are going abroad is poverty/lack of income. And this is one of the obstacles that hinder our ability to save. When people are asked why they can’t save, this is the most common reason they will offer. A huge number of Filipino families are very near the poverty line which means they can barely provide for their basic needs and there is simply not enough money to save. But yet, people will point out, too, that those with very low incomes of Filipinos in general have also poor spending habits. They still spend on non-essential items, like buying a DVD player and TV set, or cigarettes and alcohol, or spending so much for a party to celebrate a child's first birthday! These people may be considered as living in the “culture of poverty”. When you're poor, you live for today. Without hope of a better future, you spend whatever comes your way. Many Filipinos call this the "one day millionaire" syndrome. The most heartbreaking example would be the coming of many of our overseas workers. They come home with lots of dollars, check the whole family into a four- or five-star hotel, host several parties and, of course, give away all kinds of pasalubong (gifts), and in a few weeks, all their earnings are gone.

Another form of culture that works against the ethic of savings was rooted from the “big man feast” culture. A tribal leader is expected to sponsor big feasts from time to time as a way of redistributing his wealth as well as asserting his authority and influence. As cultural practices go, the "big man" and the elite get imitated by the lower strata of society and in the end; you have even the poor trying to outdo each other with extravagance. The greatest concern of some of our countrymen is that neighbors will talk if you hold too small a celebration for a certain occasion. Celebration of fiesta is another modification of this culture wherein the community is showcasing the wealth of one another as individual and as a town.

“Manana habit” is another trait of Pinoy which attributed to our poor savings habit. Filipinos are notorious for this “tsaka na” habit and it shows in almost everything we do; even when it comes to saving. Many put off saving for another day reasoning out that there are way too many things to enjoy right now without even knowing the importance of starting to save now and enjoy the benefit of compounding interest.

Culturally, it's a dangerous situation we're in, and we better start thinking of strategies to improve our financial situation. We have to start especially with children by influencing them of the proper culture of savings. Do not make the poverty issue as an excuse, but rather use it as a challenge. Do something to improve your current situation and find ways to boost your earnings. The ability to save is not just about how much you earn, but more importantly how much you keep. Regardless of your income you should be able to save, even a little, just to start your habit of saving and break the habit of irresponsible spending. Live within your means and spend your money wisely at all times. We should have the proper discipline of saving first then spending the rest of our income and not the other way around. It’s always better to plan ahead for your own future and in case of any emergencies. If every Filipinos have this kind of habit, then we can help ourselves and the country in a broader sense.

Merry Riana is a young millionaire, successful entrepreneur, best-selling author, dynamic trainer, and popular media personality. Aligned with Merry’s commitment to contribute back to society, she has pioneered three non-profit initiatives, Project: A Gift From A Friend, Personal Mentorship Experience, and Project: A Christmas Gift. To know more about Merry, visit her website www.MerryRiana.com.sg.

Noriel Malacaman is an alumnus of UP Los Banos. He is currently working as a Financial Consultant representing the leading financial services company in Singapore. Email: This e-mail address is being protected from spam bots, you need JavaScript enabled to view it , HP: 96585754, PinoySG username: noriel_malacaman